A water main break in Chelsea caused L train service to be disrupted on Wednesday morning as crews worked to stop the flooding.
According to the Department of Environmental Protection, the 20-inch pipe located at Seventh Avenue between 14th and 15th Street burst at around 5:35 a.m. The water was later shut off though, stopping the leak, though not before some flooding in the subway. As of 9:30 a.m., crews were still working to excavate the roadway and repair the main though 14th Street was reopened to traffic.
As of 9:15 a.m., there was still no L train service between Union Square and Eighth Avenue, though otherwise L trains were still running every six minutes, the MTA said.
Still, the agency warned, “Expect delays in both directions” and suggested taking the M14 bus instead.
On its website, the MTA said water had stopped flowing into the tunnel, and crews were still busy clearing water and debris, and inspecting all affected switch and signal equipment. “We are working hard to restore full service by the afternoon rush,” the agency said.
Update at 4:30 p.m.: A spokesperson for the DEP says a new valve has been installed and water service restored to 15th Street between 6th and 7th Avenues. Work continues to repair the main and restore water service to a building on corner of 14th Street and 7th Avenue, which is home to about 450 people. Work was still ongoing to resurface western lanes of Seventh Avenue though they were expected to reopen within the hour.
Tenants Association attorney Tim Collins at a meeting on Saturday (Photo by Sabina Mollot)
By Sabina Mollot
On the heels of the MCI settlement between CWCapital and the ST-PCV Tenants Association, around 250 tenants attended a meeting on Saturday to learn more about what the deal meant for them.
As usual almost all in attendance at the TA meeting, held at the Simon Baruch Middle School, were seniors. A bunch came armed with questions regarding the MCIs as well as quality of life and general affordability issues. However, those with unique circumstances were herded into another room at the school where there were tables to set up to help people understand the figures on their leases and with other problems.
Meanwhile, Tim Collins, the attorney for the ST-PCV Tenants Association addressed the crowd. First, he responded to some “grumbling” the deal has gotten since for most non-“Roberts” tenants, there’s only five percent removed from their monthly payments. Collins argued that as with any settlement, “you have to make deals. You have to trade something.” “Roberts” tenants wound up getting the higher reductions or full eliminations of the monthly payments because, said Collins, “they’re already paying very high rents.”
As a result of the deal, all tenants have had the retroactive portion of their MCIs (major capital improvements) eliminated. As for the monthly or permanent portion, “Roberts” tenants paying the full legal rent get a 5 percent credit. “Roberts’ tenants paying either the maximum modified legal rent or the maximum “Roberts” preferential rent get a 50 percent credit (as determined by the class action settlement). “Roberts” tenants paying less than the modified legal rent or “Roberts” preferential rent get a credit of 100 percent.
SCRIE/DRIE tenants are also exempt from having to pay the MCIs at all.
Non-“Roberts” tenants paying the full legal rent get a 5 percent credit. Non-“Roberts” tenants paying less than the full legal rent get a credit of 100 percent. The credits are retroactive to January of this year and appear as two separate credits on tenants’ rent bill from May (one for May, one for the other four months).
While discussing the settlement, Collins tried to discourage residents from filing individual PARs (petitions for administrative review) since that could unravel the settlement for all tenants, a clause CW insisted on. Those hoping to score a better deal, warned Collins, would have less standing as individuals with the Division of Housing and Community Renewal (DHCR) than a coalition like the TA has. He also pointed out that the TA had been at work for months in the hope of getting the best possible deal.
“I think we accomplished that,” said Collins.
He also shared with tenants that the settlement almost didn’t happen, with the talks breaking down twice. He declined to explain why, but admitted he wasn’t happy about having to agree that tenants would have to give up the option to file PARs.
But in trying to see it from the owner’s side, Collins said, “They wanted there to be finality. They wanted to have peace. They don’t want to fight 500 or 1,000 PARs that disrupt the deal.”
The deal does however make exceptions for tenants who want to file a PAR in unusual circumstances, such as the room count of their apartments being incorrect, since MCI costs vary based on the number of rooms in a unit.
Collins also reminded tenants that even before the negotiations, the TA had managed to convince the DHCR to knock 23 percent off the amount then-owner Tishman Speyer asked for in 2009. The challenge that followed came about after tenants received notices of the approved MCIs last fall and Collins saw that none of his arguments made in 2012 against the improvements, such as shoddy workmanship, had been considered.
The attorney also echoed the sentiment often made by local politicians that MCIs are not just a problem for tenants in Stuy Town, but a result of a law that favors landlords by allowing them to charge in perpetuity for building improvements.
“The main problem is in Albany,” he said.
Collins’ advice: Sign a one-year lease, not two.
Collins concluded his talk by urging tenants who have lease renewals coming up before October to take a one-year lease rather than a two-year one.
The reason, said Collins, who served as the executive director/counsel for the Rent Guidelines Board from 1987-1994, is that the RGB is expected to vote for a lower increase this year than what was handed down in previous years. Even a rent freeze is possible based on the preliminary vote last week. However, the increase voted on won’t go into effect until October.
Collins added that in recent years, the board’s increases amount to “nothing less than a scandal.”
The reason, he said, is that arguments made in support of owners involved projected operating cost increases that were much higher than what they actually turned out to be. At the same time, household incomes were dropping. Collins admitted that when he worked for the board, he took a somewhat hands-off approach, telling its members, “It’s not your job to make every apartment affordable or every building profitable for owners.” But over time, he started to feel like landlords were being given too much and advised the board to implement a rent freeze.
“This year I’m asking for a rollback,” he added.
Following his comments, TA President John Marsh chimed in to say Collins was speaking for himself and not on behalf of the TA, since what kind of lease to sign is always a gamble.
Council Member Dan Garodnick also spoke about the RGB, to recommend that tenants to participate in this year’s vote process by speaking at public hearings about their MCIs. With a new chair and new mayor, Garodnick pointed out that tenants have a better shot at swaying the board this year than they’ve had in the last 20 years. “I would encourage you to make your voices heard,” he said. “It’s quite an opportunity for tenants in this city.”
(Editor’s note: In a recent editorial, T&V also recommended that tenants tell the RGB about their MCIs, in the hope that hearing about unexpected increases tenants are made to pay mid-lease will have an impact on the board’s decision on the annual increase.)
The next public hearing in Manhattan takes place on June 16 at the Emigrant Savings Bank at 49-51 Chambers Street from 2-6 p.m.
ST-PCV Tenants Association President John Marsh speaking at a Tenants Association meeting on Saturday, with Assemblyman Brian Kavanagh, Comptroller Scott Stringer, State Senator Brad Hoylman and Council Member Dan Garodnick (Photo by Sabina Mollot)
Support for tenant-led purchase of ST/PCV
Another issue discussed at the meeting was the future sale of ST/PCV, with Garodnick saying a tenant-led deal has the support of the city’s housing commissioner.
Later, he told Town & Village that along with HPD (Department of Housing Preservation and Development) Commissioner Vicki Been, he’d also spoken with the deputy mayor for economic development, Alicia Glen.
“My sense from them was that they wanted to find a way to be supportive of tenants in our initiative if they can,” he said.
On the other hand, CWCapital has remained unwilling to talk business.
“Not just with us but with anybody,” Garodnick said at the meeting. “We all suspect that a sale is somewhere on the horizon, but we’re not sure when.”
(Three days after the meeting, the plan to foreclose on the Stuy Town’s mezzanine was made public.)
Tenants at the meeting at Simon Baruch Middle School (Photo by Sabina Mollot)
Why tenants are pretty much doomed thanks to Albany and City Hall
As always, there was also much depressing talk about the politics governing rent laws at the event. Local elected officials took turns at the podium explaining why tenant-friendly bills never get anywhere.
State Senator Brad Hoylman reiterated a point he’s made before, saying that until there’s campaign finance reform, the State Senate, which is controlled by Republicans, will remain a place that’s more friendly to landlords than tenants. He noted that many of the Republicans get millions in campaign contributions from real estate interests and also often live in upstate districts where there are few renters. The Olean, NY-based Cathy Young, who chairs the Senate Standing Committee on Housing, Construction and Community Development, has blocked campaign finance reform from even being discussed on the Senate floor, Hoylman said. This, he explained, is why Senate members have been reduced to arguing about yogurt.
“Her district is closer to Detroit than Manhattan,” said Hoylman of Young, who’s also legislatively tried to undo “Roberts v. Tishman Speyer.” “We need to continue to fight for campaign finance reform,” Hoylman added. “It is fundamental to changing the power dynamic in Albany.”
Assemblyman Brian Kavanagh then spoke about how the state housing agency’s new Tenants Protection Unit was in danger of being de-funded by the State Senate.
Also at the meeting was Comptroller Scott Stringer who said that the mayor’s housing plan aimed at building or preserving 200,000 units of affordable housing won’t be enough to make up for the amount of affordable units that are getting lost each year. In the last 12 years,
Stringer said, “rent have skyrocketed by 75 percent,” while in the past 16 years, 400,000 apartments that rented for $1,000 or less disappeared. “Two hundred thousand (units), it’s just not enough to deal with the crisis,” Stringer said.
Tenants Association attorney Tim Collins speaks to residents about MCIs at a recent meeting, while Assembly Member Brian Kavanagh, State Senator Brad Hoylman and TA Chair Susan Steinberg listen. (Photo by Sabina Mollot)
ST-PCV Tenants Association says it’s negotiating with CWCapital, DHCR
‘Roberts’ payments from Met approved
By Sabina Mollot
Residents of Stuyvesant Town/Peter Cooper Village, who were hit over the last couple of months with a total of five MCIs (major capital improvements), will see those MCIs on their January rent bills.
The ST-PCV Tenants Association warned neighbors of the soon-to-come increases in an email blast on Friday evening. However, the Association said it is continuing to try and reach an agreement with management. The organization also reported that tenants who have already agreed to CW’s offer to reduce their retroactive payments in exchange for not challenging the MCIs could still change their minds.
“CWCapital has asserted that any resident who previously accepted their MCI reduction offer issued in early November will have the ability to participate in any revised terms that are negotiated with the TA,” the Association wrote.
The email also noted that along with management, the Division of Housing and Community Renewal (DHCR) has also been participating in negotiations over the MCIs with the TA. Those talks have been taking place over the last few weeks.
“The Tenants Association entered into these discussions in an effort to reach an agreement that would be beneficial to tenants,” the TA wrote.
“While we hope to achieve a satisfactory settlement, CWCapital will be charging the full MCI increases starting in January 2014. However, should an agreement be achieved, any adjustments to the rent bills will be made and credits will be given in subsequent months. Note that no retroactive portion of the MCI increases should be charged at this time.”
A rep for CWCapital declined to comment on the ongoing talks.
The MCIs were issued for work done in 2009 by Tishman Speyer for security upgrades, water tanks and valves, doors and resurfacing.
In other news, residents who are members of the “Roberts vs. Tishman Speyer” class action suit will get their damages from Met Life by the end of the year.
As T&V reported last week, those residents would be getting 110 percent of what they overpaid in rent to Met, pending approval by a judge. On Friday, “Roberts” tenants’ attorney Alex Schmidt said the judge signed the order and the checks should go out no later than Friday, December 27. Payments from CWCapital should follow, he added, “hopefully” in one or two installments in the next 60-90 days.
Of the 12,000 people who filed claims for “Roberts,” more than 3,000 are getting payments from Met Life.
At a meeting held on November 2, ST-PCV Tenants Association attorney Tim Collins speaks to residents about the MCIs, while Assembly Member Brian Kavanagh, State Senator Brad Hoylman and TA Chair Susan Steinberg listen. (Photo by Sabina Mollot)
By Sabina Mollot
Residents of Stuyvesant Town/Peter Cooper Village won’t see the recently approved round of MCI rent hikes on their rent bills until after the holidays, CWCapital has announced.
In an email sent to residents on Friday, the special servicer said:
“CWCapital and CompassRock Real Estate have agreed to defer new MCI billing until January 2014. As a result, your December 2013 rent bills will not include the recently approved MCIs. CWCapital, the ST/PCV Tenants Association and DHCR are engaged in discussions regarding the implementation of the MCIs and we will keep residents informed of any developments.”
A spokesperson for management declined to comment further on the delay to implement the MCIs, which the Tenants Association also mentioned in an email to neighbors sent at around the same time in the afternoon as CW’s. The Tenants Association also noted that it was engaged in discussions with CWCapital and the Division of Housing and Community Renewal (DHCR) of New York Homes and Community Renewal (HCR), the state housing agency.
In the past month, tenants have received notices that MCIs (major capital improvements) for security upgrades done in 2009 as well as work done that year on doors, resurfacing and water tanks and valves, had been approved. The Tenants Association has since said it would challenge those MCIs, while CWCapital has made an offer to reduce the MCIs’ retroactive portions by 35 percent if tenants agree not to partake in any challenge. The DHCR, meanwhile, recently agreed to the Tenants Association’s request for reconsideration of the MCIs.
Tenants Association volunteers John Sicoransa, Judith Preble Miller and Anne Greenberg hand out fliers that urge tenants not to sign CWCapital’s offer while outside 360 First Avenue, where an informational workshop on MCIs was being held. (Photo by Sabina Mollot)
By Sabina Mollot
Following a contentious meeting held earlier in the month by the Stuyvesant Town-Peter Cooper Village Tenants Association, during which the group’s attorney advised tenants not to accept an MCI reduction offer from CWCapital, the special servicer reached out to tenants to discuss terms.
In letters slipped underneath doors in ST/PCV on Friday, CW offered to reduce the cost of the retroactive portions of recently issued MCIs (major capital improvements) by 35 percent, as long as tenants agreed not to try to challenge them. There was also an offer to reduce $15 million on other costs. However, the letter then went on to indicate that CWCapital could end up backing out of the deal.
“It is important to understand that under the Rent Stabilization Laws a small number of MCI appeals can impact the entire community,” the letter stated. “In the event that such a minority of residents seeks to undo the effect of this settlement, we may have no option but to permanently withdraw this offer as the owner will then be forced to defend its rights.”
This letter was swiftly responded to by the Tenants Association’s attorney Tim Collins. In his own letter, he addressed CW’s attorney Sherwin Belkin to say he thought the offer was “disturbing” because “it appears to be an attempt to intimidate those tenants who support the TA’s challenge to the MCIs, by penalizing or diminishing their rights, in direct violation of…. The Real Property Law…”
The Tenants Association, meanwhile, has also taken issue with a series of MCI information workshops being held this week by CW representatives at 360 First Avenue in Peter Cooper Village. In an email to neighbors, the TA blasted the workshops as a ruse to get tenants to sign CW’s agreement rather than inform them about how MCIs work.
“The proposed agreement is illusory, deceptive and unenforceable,” the TA wrote on its website. “The language of the form encourages acceptance while the owner holds a trump card of unilateral termination.”
The TA also noted that CW hadn’t mentioned that the retroactive portions of the MCIs, which for some residents can total thousands of dollars, get paid on a monthly basis (rather than a lump sum), with payments capped at six percent of the tenants’ rent in 2009. As for the $15 million in costs CW offered to waive, the TA said this was “almost meaningless — it consists of sales tax, which can never be included, and other costs DHCR almost never approves.”
On Monday evening, the first of the series of workshops on MCIs saw only a trickle of tenants coming in and out, as well as a few volunteers for the Tenants Association standing outside the building, hoping to talk neighbors out of signing any deal with the de facto owner.
One reason for this is that as of Friday, the state housing agency, the Division of Housing and Community Renewal (DHCR) of New York State Homes and Community Renewal (HCR), has agreed to the TA’s recent request for reconsideration of MCIs for five projects that were authorized by the agency. This means tenants are not yet responsible for paying the retroactive portion, though they will be expected to pay the monthly cost that’s added to their rent in perpetuity until the agency makes a decision.
Three of the MCIs are for Stuy Town residents, and the other two are for Peter Cooper residents. The
Tenants Association volunteer John Sicoransa talks to a neighbor on First Avenue. (Photo by Sabina Mollot)
MCIs are for work done in 2009 by Tishman Speyer on security upgrades, resurfacing, doors and water valves and tanks. All the MCIs are added to the tenants’ monthly rent with costs varying based on the room count of apartments and whether they’re in PCV or ST, and all have retroactive portions that date back to 2009.
The TA is hoping to challenge the MCIs based on the fact that Collins’ arguments made against them to the DHCR last year were not even acknowledged in the recent awarding of the increases to CWCapital. Additionally, Collins cited violations in some of the buildings, student housing in some apartments and shoddy workmanship on the resurfacing work as well as other factors.
The reconsideration means the TA will not yet be filing a petition for administrative review (PAR), as it had previously planned to do. However, the group is still collecting signatures from neighbors for pledges that would authorize the TA to represent tenants if it does file a PAR, which according to TA Chair Susan Steinberg, will most likely happen. “We’ll pursue it as far as we can carry it,” she said.
Over the years, the state housing agency has rejected almost all of the Tenants Association’s MCI challenges. However, as of Monday, the Tenants Association had collected over 2,000 signatures on its pledge.
While outside the MCI workshop, TA reps, including Steinberg and TA President John Marsh asked residents leaving if they thought they’d be accepting the offer for a retroactive MCI reduction, and a few were undecided.
One man, who moved in last year, said he was concerned that he would have to pay the retroactive portion of the MCI despite being a new tenant. A TA volunteer responded to say he thought the owner would instead have to hunt down the previous tenant to try and collect that amount, though he added something Collins had said at the recent TA meeting, which is that owners making such moves happens pretty rarely.
Another resident, a woman who lives in Peter Cooper, seemed less confused, saying she thought the reduction letter was “a non-offer.”
“I used to sell TV shows, and I learned from my boss I can’t respond to a non-offer,” she said.
When asked what she was told at the workshop, another woman, who said she didn’t know if she’d be taking the deal, said she was told that she’d have to pay “a lot higher” of an amount if she didn’t.
Another resident said she wound up feeling uncomfortable at the fact that there was a guard posted outside the workshop building, and once she went inside, saw that there were two more. Before allowing her into the workshop, the woman, who, like the other attendees interviewed, didn’t want her name published, said she was asked for her address and apartment number. Though the guards were nice, “It just made things uncomfortable,” she said. “If they can’t trust me, how can I trust them? This is a tall order without trust.”
Attending was worthwhile though, she said, since she got useful information about her own particular situation — and extra incentives to sign. Still, she thought she would most likely not take the deal.
John Sicoransa, one of the TA volunteers outside, said that neighbors of his who are “Roberts v. Tishman Speyer” class members “are utterly confused” by the offer. Being former market rate tenants, they hadn’t received notices in 2009 about pending MCIs, which are for rent-stabilized tenants, though they did get the recently issued letter from CWCapital. Additionally, “the post-Roberts people got them,” said Sicoransa.
Future MCI workshops being held by CWCapital will take place on Thursday, November 14 from 5-8 p.m. and Friday, November 15 from 8:30 a.m.-11:30 a.m., both at 360 First Avenue.
A spokesperson for CWCapital did not respond to requests for comment about the MCI workshops. However, the rep, Brian Moriarty, commented on the offer to say it was done in “good faith” and also noted that tenants’ appeals over previous MCIs haven’t gotten them much.
“The owner made a good faith offer to the community,” said Moriarty. “Historically, tenant appeals have resulted in negligible increases after protracted administrative and court proceedings. We do not believe that repeating this process is healthy for the broader community. Assuming that tenant appeals achieve a five percent decrease in the approved amounts (which is more than what has been achieved over the past 20 years of tenant appeals), then it would take the average tenant approximately 25 years to equal the benefit that the owner has volunteered to make. We hope residents review their offers carefully and do their homework to understand the benefit we are offering.”
Tenants Association President John Marsh hands out fliers on the MCIs. (Photo by Sabina Mollot)
Marsh, meanwhile, in a written statement, blasted the offer as “an attempt to legitimize an unenforceable scheme” to get tenants to waive their right to challenge MCIs.
“While we appreciate any gesture by management to soften the blow of these increases, it is not enough for them to look at just the retroactive amount,” he added. “We are also concerned with the permanent increase. We will keep all channels of communication open with management while we continue to collect public membership pledges, so we can be in a position of even greater strength moving forward.”
The Tenants Association’s MCI pledge is currently on its website at stpcvta.org.
TA tells tenants: Ignore CWCapital’s reduction offer,
CW says: We’re trying to avoid conflict
Tenants pack a meeting on MCIs, held at the Simon Baruch Middle School auditorium. (Photo by Sabina Mollot)
By Sabina Mollot
After residents were hit with five MCIs (major capital increases) in October for upgrade projects in Stuyvesant Town and Peter Cooper Village, management firm CompassRock made an offer to try and reduce the retroactive portions of those increases — an offer that the Tenants Association swiftly responded to, to suggest that neighbors ignore it.
The MCIs were discussed by the Tenants Association’s attorney Tim Collins at a meeting held on Saturday at the Simon Baruch Middle School auditorium.
This meeting, which was attended by around 500 people, took place a day after tenants received a letter from CompassRock, which mentioned that management hoped to work with tenants to lower the amount of retroactive charges in the MCIs “in order to mitigate the impact of this component for our longer term residents.” It also mentioned that some residents — those whose legal rent is higher than their preferential rent (what they actually pay) — shouldn’t see any increases at all.
However, the letter, which was unsigned, then went on to warn tenants that though they have a right to challenge the MCIs, if they did, they could forget management’s offer to try and reduce the retroactive portion, and that even if tenants did appeal, the MCIs would still likely be approved.
“It is our belief based upon legal advice received that at the end of any appeal process, we will obtain all or almost all of the amounts reflected in the orders,” the note read. CompassRock then went on to say management hoped to address the issue with tenants over the next few weeks so the proper amount of rent could be issued in the December bills.
“We hope that our residents take this letter as it was intended — not as a formal legal offer, but as a gesture of our good faith and a commitment from us to mitigate the effect of these orders,” said the note.
A few residents told Town & Village they thought the letter had a threatening tone, and later, Brian Moriarty, a spokesperson for management and special servicer CWCapital issued a statement, explaining that the offer was made to avoid any conflict with the tenants.
“We intend to make public final settlement terms by the beginning of next week,” said Moriarty. “In doing so, we are seeking to mitigate the effect of the MCIs and provide residents with clarity regarding their ongoing rents. As we stated in the letter, we have received legal advice to the effect that all, or almost all, of the MCIs that have now been lawfully approved by DHCR will ultimately be granted, but perhaps after some lengthy and contentious delay. This does not seem good for the community overall, or for individual residents, and therefore we will seek to waive a meaningful amount of the retroactive charges for residents. We are confident that this gesture of good faith will be positively received by our residents. Obviously, we respect that all residents will need to see the details in order to make their judgment. We assume that the vast majority of residents understand that it is not possible to compromise while simultaneously contesting the compromise. Unfortunately, the way the rent stabilization system works, it seems that appeals from a small minority of residents could disrupt a settlement of which a significant majority of the property is in favor. We feel that it is important people know and understand this.”
But at the meeting, Council Member Dan Garodnick commented on the letter to say that he thought the offer to reduce the retroactive amounts — but not the monthly increase that would be charged in perpetuity — was only made because the monthly increase is added to tenants’ base rents. This would bulk up the property’s rent roll, which would be attractive to a potential buyer, noted Garodnick, while the retroactive charges “do nothing for that.
“While we appreciate the gesture, we may have to challenge them in any event,” Garodnick added. “CW is well aware that we have the ability (through a challenge) to tie the system up for quite some time.”
Tenants Association attorney Tim Collins speaks to residents, while Assembly Member Brian Kavanagh, State Senator Brad Hoylman and TA Chair Susan Steinberg listen. (Photo by Sabina Mollot)
Collins also spoke about the offer to say he was confident that the MCIs would be rescinded if appealed due to the fact that his arguments on behalf of the TA on why they shouldn’t be implemented, which were made last year, weren’t even acknowledged in the responses. Previously, he referred to this as a “reversible” error.
“You should ignore that letter,” he said at the meeting, then addressing any CW employees who might be in the audience to add, “That doesn’t mean we’re ignoring it.”
He added that complaints include the TA’s belief that since some of the work benefits ST/PCV’s commercial tenants, they too should share in the cost and that in some buildings, there were “class C” violations found, which would make the owner ineligible for an MCI. There was also the issue that some apartments were being used for student housing. Another argument, specifically against the resurfacing MCI was due to the quality of the work.
“We have 40 to 50 pictures showing what a mess it was,” Collins said. “The workmanship was horrendous. So we were really surprised when these things (MCI notices) started pouring out.”
Decisions on whether to grant MCIs are made by the state housing agency, the Division of Housing and Community Renewal (DHCR) of New York State Homes and Community Renewal (HCR). The applications for the MCIs were made in 2009 by then-owner Tishman Speyer for security upgrades, including a now destroyed command center and video intercoms in Stuyvesant Town as well as (for Peter Cooper residents) work on water valves and tanks and (for Stuyvesant Town residents) resurfacing work which was bundled with charges for doors and water tanks and valves. Costs of the different MCIs vary per tenant, but all include retroactive portions to account for the time from when the work was done to when the decision to authorize the MCI was granted.
Only half jokingly, when Collins took the podium, he slammed down a pile of paperwork that was about six inches thick. Collins then told the audience that if he wasn’t confident about getting results from the HCR, he wouldn’t have shown up at the meeting. “I would not have canceled my proctologist appointment,” he said.
The attorney also asked residents to sign a pledge, which would allow the TA to represent them in a joint petition for administrative review (PAR). Collins has asked that tenants not file their own PARs, unless they have “unique circumstances,” since the TA believes a joint argument will have more strength. The TA is also preparing another document called a request for reconsideration.
On CW’s current offer to tenants, Collins said it could later cause increases for tenants whose preferential rents are lower than the legal rents, which are the maximum amounts an owner can charge.
“You have to understand how preferential rents work,” he said. “Preferential rents can be changed upon a renewal. They might say, ‘Right now you see no change, but next time we’re going to raise it.’”
He added, “I think we’re prepared to ask for more. A lot of the work was shoddy. A lot of the work was redundant.”
SCRIE, DRIE and MCI legislation
Along with Collins, other speakers at the event, which was emceed by TA Chair Susan Steinberg, included local elected officials such as Garodnick, Assembly Member Brian Kavanagh, Congress Member Carolyn Maloney, Borough President Scott Stringer and State Senator Brad Hoylman.
While at the microphone, Hoylman mentioned that there is currently some relief from MCIs for tenants who are eligible for SCRIE (Senior Citizens Rent Increase Exemption) and DRIE (Disability Rent Increase Exemption). Through those programs, tenants would be locked into the rent they paid when they first signed their lease except under extreme circumstances. To make sure an MCI would be covered, tenants would have to apply to the program within 90 days of it being issued. “But,” noted Hoylman, “it must be completed for each MCI separately.”
Kavanagh, who then discussed the state of the housing law that determines MCI policy, got some chuckles out of the audience when he mentioned that, “The MCI system is part of a larger system that was intended to protect tenants.”
However, legislation authored by Kavanagh, which seeks to end MCI payments once the cost of the improvement would be recouped by owners, has been collecting dust in Albany. He noted that the housing laws are up for expiration again in 2015 and he hoped to get the bill passed then, which would also add more oversight to the application process. At this time, the HCR has a limited ability to verify “what costs for improvements really are.”
Tenants argue against the MCIs
Following statements from local elected officials, tenants then lined up to ask questions about the MCIs, the overall theme of which seemed to be: What can be done to stop them and why is CWCapital entitled to money for work that was paid for by Tishman Speyer?
Stuyvesant Town resident Liza Sabater asks a question as other tenants line up to do the same. (Photo by Sabina Mollot)
“CW is nobody who actually spent money on the major capital extortion, I mean improvement,” griped one tenant.
In response to the latter question, Collins said that it was standard that a new owner step into the shoes of the old owner.
As for the former question, Kavanagh responded to say the answer was in restoring home rule from the state to the city, because in the state legislature, many of the politicians making decisions on city housing law live outside the city with few rent-regulated renters as constituents.
Another resident then suggested that the Tenants Association purchase shares of Walker & Dunlop, the parent company of CWCapital, so tenants could be at company board meetings. This got the attention of Garodnick, who responded, “How much are shares? I say we do it.”
When another resident asked if tenants could be socked with yet another MCI for the ongoing renovation of the storefronts on First Avenue, the answer was no, because it doesn’t benefit all tenants.
Another resident, introducing herself as Emily Juno, said she’d lived in the community for 18 months and was never notified about a pending MCI. She added that she had neighbors who’d told her the same. In response, Collins said she wouldn’t have to pay it in that case, but also cautioned her to check her lease and any riders to make sure there was no reference to an MCI.
A resident named Liza Sabater, who said she’s raising two children in Stuyvesant Town, said she had a “mundane” question, which was that she didn’t even know the amount to put on her rent check. The wording in the MCI documents made her wonder if her rent had been increased by over $1,000, but Collins said no one’s rent had gone up that high, because the monthly MCI payments are capped at six percent of whatever each tenant’s rent was in 2009.
A longtime resident, Tom Hickey, said he didn’t believe the resurfacing MCI was valid because he recalled similar work being done at the turn of the millennium. (Later, he said he filed his own objection in 2009 to the housing agency since the last resurfacing was actually done in 2003 or 2004 by Met Life.) Didn’t this, Hickey asked, mean the 2009 project occurred before the prior resurfacing had completed its useful life? Collins said he’d check to see if that information was included in his objections.
Another resident wanted to know why there was a retroactive portion if MCIs get paid on a monthly basis, anyway, to which Collins replied that, “It doesn’t make sense to me if it’s in perpetuity, but that’s the way the law works.”
Following the meeting, Steinberg said that the TA had collected around 750 signatures on its pledge for a joint challenge of the MCIs, but said the association was still looking for more and would be putting the pledge online on the TA website (stpcvta.org).
The Stuyvesant Town-Peter Cooper Village Tenants Association will hold a meeting to address five recently issued major capital improvement (MCI) rent increases on Saturday, November 2 from 1-4 p.m. at the auditorium at the Simon Baruch Middle School (MS 104) on East 20th Street between First and Second Avenues. Local elected officials are expected to attend and John Marsh, president of the Tenants Association, said there would be “ample time” for tenants to ask questions, which will be answered by the association’s attorney Tim Collins.
In October, tenants in Stuyvesant Town learned they’d gotten an MCI (major capital improvement) for video intercoms, followed by an MCI issued to residents of Peter Cooper, which was also for security upgrades, including a command center. Tenants learned about the latest round last week, via notices that the state housing agency, the Division of Housing and Community Renewal (DHCR) of New York State Homes and Community Renewal (HCR) had approved MCIs for work on three more projects: water valves, doors and resurfacing. Possibly more MCIs are on the way.
Which MCIs tenants got depended on if they live in Peter Cooper or Stuyvesant Town. As far as the Tenants Association is aware, an MCI for water tanks and valves is for PCV residents only; while only Stuyvesant Town residents have gotten MCIs for resurfacing that were combined with charges for doors and water tanks/valves.
At the meeting, Collins will explain the process of appealing an MCI order and will outline what the TA’s pushback will be. He will be joined by New York State Senator Brad Hoylman, Assembly Member Brian Kavanagh and City Council Member Dan Garodnick.
“Both longtime rent-stabilized tenants and those who recently moved in and are receiving MCIs addressed to former residents or current occupant have been swamping our message center with questions about the MCI process,” said Marsh. “We’ve put together this meeting to answer precisely those questions.”
Subjects to be covered, according to Marsh, include: What constitutes an MCI? Why are tenants getting such a flood of MCIs at once? How do the retroactive and prospective payments work? Is there any way to put an end to paying MCIs in perpetuity? Why is there a per room charge when, for example, there is outdoor resurfacing work? Why should tenants have to pay if the improvement in question is faulty or doesn’t work?
“We have long understood that an owner needs to improve their property, but it must not be at the expense of long-term affordability,” said Marsh in an official statement. “When a co-op/condo owner is assessed for an improvement, they are assessed only once, not for the rest of their tenancy. Renters on the other hand are forced to pay forever for something that is depreciable.”
An opportunity to sign a document association with the association’s petition for administrative review (PAR) can be signed at the meeting. The association is also asking tenants to share their docket numbers and Google documents are available for this purpose through links on the association’s website at stpcvta.org. Additionally, the group is soliciting donations to help pay its looming legal bills for the MCI challenges.
Susan Steinberg, chair of the ST-PCV Tenants Association, pictured at a protest against mid-lease rent increases in May, said the Tenants Association will soon hold a meeting on the latest MCIs. (Photo by Sabina Mollot)
By Sabina Mollot
While not quite the chaos caused by Hurricane Sandy a year ago, Stuyvesant Town and Peter Cooper Village are being flooded again, this time with five MCIs for work on the property done by former owner Tishman Speyer in 2009.
Earlier in the month, tenants in Stuyvesant Town learned they’d gotten an MCI (major capital improvement) for video intercoms, followed by an MCI issued to residents of Peter Cooper, which was also for security upgrades, including a command center. Tenants learned about the latest round on Friday and over the weekend, via notices that the state housing agency, the Division of Housing and Community Renewal (DHCR) of New York State Homes and Community Renewal (HCR) had approved MCIs for work on three more projects: water valves, doors and resurfacing.
Which MCIs tenants got depended on if they live in Peter Cooper or Stuyvesant Town. As far as the Tenants Association is aware, an MCI for water tanks and valves is for PCV residents only; while only Stuyvesant Town residents have gotten MCIs for resurfacing that were combined with charges for doors and water tanks/valves.
“We tenants are under siege,” the Tenants Association said in an email to residents sent on Sunday, which included a notice that a meeting would be scheduled soon to answer questions on the charges, which are added permanently to tenants’ base rent, along with a retroactive portion. Costs vary with each building and with each apartment, based on how many rooms there are.
Susan Steinberg, chair of the Tenants Association, noted how in the case of one Peter Cooper one-bedroom apartment, the MCI for water tanks, which has a cost of $2.77 per room, the retroactive portion is $407.19. Her own recently issued MCI, being for a one-bedroom in Stuyvesant Town, which includes water tanks, resurfacing and doors, will cost a total of about $25 a month while the retroactive portion is $1,199.52.
Like the previously issued MCIs, the Tenants Association is planning to challenge the ones for water valves, doors and resurfacing, based on the fact that in its decisions, the HCR didn’t respond to arguments against them presented to the agency by the Tenants Association’s attorney last year, and possibly other reasons. The Tenants Association said, via email, that it was already in the process of filing what is known as a request for reconsideration, since it believes the housing agency made a “vital (but reversible) administrative error by not considering or acknowledging our 2012 objections to all outstanding MCIs. The approvals, therefore, were issued on an incomplete record.” The association’s attorney, Tim Collins, is also preparing a petition for administrative review (PAR), in case the request for reconsideration fails. The association, therefore, has been requesting that tenants opt not to file their own PARs, though doing so would spare them from having to pay at least the retroactive portion of the MCIs until the matter is resolved by the HCR.
“Individual tenants certainly have a right to file their own PARs,” said Steinberg, “and if they want to, I wouldn’t say don’t, but we have more strength if we file a collective PAR. It’s really better if we can provide tenants with specific reasons. It’s really not enough to say the security system still doesn’t work. It’s a legitimate reason to me, but I think (HCR) requires a lot more technical information.”
Meanwhile, despite the recent communications from the agency, there has not yet been any word on the Tenants Association’s application for a rent reduction based on Sandy-related service losses in 15 PCV buildings and two in Stuyvesant Town. A spokesperson for HCR did not respond to a request for comment on the latest MCIs and has previously said the agency would not comment on its determinations.
Steinberg, however, blasted the five most recent MCIs as “a terrible burden” on tenants.
“People are gasping,” she added. “Those on SCRIE and DRIE are concerned and we want to make sure they’re not going to be slammed, and it’s right before the holidays. This is going to stretch people to the max.”
The Tenants Association will hold the MCI meeting on Saturday, November 2 from 1-4 p.m. at the auditorium at the Simon Baruch Middle School (MS 104) on East 20th Street between First and Second Avenues. Local elected officials are expected to attend and John Marsh, president of the Tenants Association, said there would be “ample time” for tenants to ask questions, which will be answered by Collins.
“The meeting will also give those in attendance an opportunity to sign a document in connection with the filing of a PAR,” said Marsh. “Residents who can’t make the meeting might consider dropping by the school any time between 1 and 4 to add their names.”
The association is asking tenants to share their docket numbers and Google documents are available for this purpose through links on the association’s website at stpcvta.org and the group is also soliciting donations to help pay its looming legal bills for the MCI challenges.
A spokesperson for CWCapital did not yet respond to a question about whether the MCIs would be reflected in the rent bills for November or December, though Steinberg has said she suspects that since the MCIs came as much as a surprise to CWCapital as they did to tenants, that they would not be charged in the November bills.
Note: This article has been updated to include additional information about the ST-PCV Tenants Association meeting.